Cyanobacteria are able to form stable nitrogen-fixing symbioses with diverse eukaryotes. To extend our understanding of adaptations imposed by plant hosts, two-dimensional gel electrophoresis and mass spectrometry (MS) were used for comparative protein expression profiling of a cyanobacterium (cyanobiont) dwelling in leaf cavities of the water-fern Azolla filiculoides. Homology-based protein identification using peptide mass fingerprinting [matrix-assisted laser desorption ionization-time of flight (MALDI-TOF-MS)], tandem MS analyses, and sequence homology searches resulted in an identification success rate of 79% of proteins analysed in the unsequenced cyanobiont. Compared with a free-living strain, processes related to energy production, nitrogen and carbon metabolism, and stress-related functions were up-regulated in the cyanobiont while photosynthesis and metabolic turnover rates were down-regulated, stressing a slow heterotrophic mode of growth, as well as high heterocyst frequencies and nitrogen-fixing capacities. The first molecular data set on the nature of the NifH post-translational modification in cyanobacteria was also obtained: peptide mass spectra of the protein demonstrated the presence of a 300–400 Da protein modification localized to a specific 13 amino acid sequence, within the part of the protein that is ADP-ribosylated in other bacteria and close to the active site of nitrogenase. Furthermore, the distribution of the highest scoring database hits for the identified proteins points to the possibility of using proteomic data in taxonomy.